Crisil Limited Vs ACIT (ITAT Mumbai)
ITAT Mumbai held that disallowance under section 40(a)(ia) of the Income Tax Act unjustified when reimbursement of expenses is considered as receipts in total income and tax is paid on the same therefore no disallowance in terms of proviso to section 201.
Facts- In this case original assessment was made u/s.143(3) vide order dated 13/03/2015, wherein, the addition of Rs. 1,07,51,004/- was made u/s.40(a)(ia) of the Act for non-deduction of tax at source for payments made to Crisil Ltd., which was in the nature of reimbursement of expenses.
AO confirmed the disallowance of Rs.74,57,621/-however deleted the addition / disallowance of Rs.32,93,383/-which was as per the direction of the Tribunal was towards reimbursement of expenditure wherein, no TDS provision would apply.
CIT (A) despite the fact that ld. AO was passing order giving effect to the ITAT order which was set aside to him after making observations and addition of Rs.32,93,383/- was directed to be deleted because it related to expenses where no TDS provision was applicable, he not only upheld the addition made by the AO but also further enhanced it by making the disallowance of Rs.32,93,383/- without providing any opportunity or notice of hearing to the assessee.
